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An International Meeting of American Accounting
Association
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Disclosure of Financial Statement Information in Earnings Announcements |
Julia D’souza
Cornell University
K. Ramesh
Michigan State University
Min Shen
George Mason University
Abstract: This paper examines disclosure strategies in earnings announcements for the entire population of non-regulated firms for which data are available over the period 2000-2003. The study examines firms’ choice of how much financial statement information to include in earnings announcements, and which line items to disclose from the three major financial statements. We document that the disclosure incentives examined in the past research influence the overall extent of financial statement information released in earnings announcements. More importantly, we document that there are systematic patterns in the propensity of firms to jointly disclose different categories of line items in earnings announcements. We show that different firms include different line item categories in earnings announcements consistent with their desire to facilitate investor valuation. Consistent with investor demand, we also document systematic differences across industries in the disclosure of performance metrics.